Africa is a large continent with a rich and diverse environment, resulting in many challenges, such as access to drinking water, rapid urban development, active deforestation, and food insecurity.
At a time when these challenges are taking their toll on communities, the COVID-19 crisis threatens the African economy and hinders efforts to achieve global development priorities.
The United Nations Economic Commission for Africa reports that economic growth will slow from 3,2% to 1,8%, pushing 27 million people into extreme poverty.
Africa’s ability to respond and recover is linked directly to how well the human population’s impact on natural resources is understood. Earth observation data is the cornerstone to this information, and a key transition of the Fourth Industrial Revolution is the change in how this data is accessed and used to support a quick response to these critical challenges.
Earth observation provides vast quantities of satellite data for monitoring and managing Earth’s natural resources and the human and climatic impact on them. Digital Earth Africa (DE Africa), funded in part by the Australian government, is building the world’s largest operational platform for accessing and analysing decades of satellite imagery specific to Africa.
The project will translate data from the world’s free Earth observation satellites into ready-to-use insights about the continent’s environmental conditions.
This is an example of how Fourth Industrial Revolution technology can enable widespread socio-economic development. The insights it offers can be used to tackle a wide range of issues, including water scarcity, land use and food security.
Even under conservative assumptions, the impact of DE Africa could be higher than US$2 billion (nearly R30 billion) a year. However, shifting such economic estimations to action at scale will require the uptake and integration of data analytics practices and analysis-ready Earth observation data into business models and political systems.
Drawing on existing frameworks and identifying gaps to make improvements will enable this data to be used to address Africa’s critical challenges.
Boosting agricultural productivity
Agriculture is the lifeblood of many African economies, employing over 40% of the continent’s total working population and accounting for almost one-tenth of GDP.
Yet productivity rates are often far from global best practices and local farmers are frequently missing accurate information such as water availability and crop development.
Through the provision of Earth observation data products for African agriculture, DE Africa has the potential to generate an impact of up to US$1 billion (about R15 billion) a year.
These economic benefits would be generated by exploiting Earth observation technologies in four areas already demonstrated in other parts of the world and applicable to Africa, the first of which is in water savings.
Africa’s share of global freshwater resources is only 2% less than its share of world population (10% vs 12%), yet rainfall is unevenly distributed, since 86% of water withdrawals in Africa are used for agricultural purposes, with the share even higher in arid and semi-arid regions. The main consequence is a significant reduction in crop yield.
The primary cause of water waste in the African agricultural business is evaporation, caused by high temperatures, inefficient storage of water reserves, and non-optimal irrigation plans. Satellite imagery can help smooth this problem.
In combination with meteorological and spatially explicit training data and hydrological modelling, it can be used to derive information about the past and current state of main crops to make future predictions. It could thus improve water procurement and water allocation before and during irrigation, reducing water shortages.
Even assuming a conservative 20% impact on African cultivations and extending such benefits to all cultivations, the results may be very significant. By improving irrigation plans and adjusting timing and resource allocation, DE Africa could save 176 billion cubic metres of water a year, equivalent to a US$880 million (R13,1 billion) reduction in water abstraction costs.
The water savings that DE Africa could realise in only one year would be enough to meet eight years’ water requirement from African households.
Increased Crop Yields
Due to insufficient production, sub-Saharan African economies spend between $30 billion and $50 billion (R445 billion to R740 billion) a year to import food.
If domestic production does not catch up with domestic food requirements, Africa could spend more than US$150 billion (R2,2 trillion) on food imports by 2030.
Several studies demonstrate that increasing agricultural productivity helps boost rural incomes and increases food availability. However, the productivity levels of many cultivations and food staples produced in Africa are below international averages, due to lack of knowledge of up-to-date technology and practices, low use of chemically improved and hybrid seeds, and inadequate irrigation plans.
Earth observation can be used to improve crop monitoring at field and farm level, and could be the basis of accurate models set up to identify and remove factors causing lower yields (for example, sowing too late for current weather conditions), and making informed decisions on when to irrigate.
Earth observation data can also provide a rapid, standardised and objective assessment of the biophysical impact of agricultural practices in terms of vegetation cover, calling for restoration interventions when most needed. Through optimising sowing dates, DE Africa could raise its annual wheat production (10% effect) by 136 000t, bringing a benefit of at least US$35 million (R519 million) to the continent’s economy.
Reduced Insurance Cost
A key hindrance to the insurance industry is information asymmetry, which causes moral hazard and shrinks the growth margins of the sector. Usually, insurers have little information on their insured farmers, no insights into how they run their business, and no control over their actions.
This results in huge risk borne by providers, which is reflected in the high premiums they set for farmers.
The problem is even more relevant in Africa, where insurance penetration (2% on average) is far below the threshold of developed economies (6%). Satellite data can improve transparency of agricultural activity and output, as it helps assess crop conditions and environmental risks.
This enables companies to develop index-based insurance products. Earth observation data may also be used to develop algorithms to assess farmers’ creditworthiness, enabling access to resources to improve production.
It is estimated that developing sustainable financial products based on increased transparency in Africa will reduce costs and help create new tailor-made solutions, allowing farmers to save US$20 million (R297 million) in premiums and expanding the insurance market by at least US$25 million (R371 million).
Furthermore, if farmers are properly insured, they can rebuild more effectively if hit by disasters, instead of risking the loss of their main source of income.
Reduced pesticide usage
Despite several benefits in agricultural practices, such as productivity improvements, pesticides can have severe consequences for public health and the environment. Through implementing best practices and preventing the spread of diseases, pesticide use could be reduced.
Earth observation data could play a focal role in setting up development models aimed at monitoring the evolution of diseases and the massive movements of insects. Such models would be crucial in forecasting how much and where these phenomena spread, to focus and limit pesticide intervention instead of resorting to broad-based, spray-all campaigns.
The views expressed in our weekly opinion piece do not necessarily reflect those of Farmer’s Weekly.
This article is an edited excerpt from the World Economic Forum’s report titled ‘Unlocking the potential of Earth observation to address Africa’s critical challenges’ published in January 2021.